Tuesday 13 November 2018

Austerity matters

I happened to dip into a TV programme the other day that looked at the life of a school over the course of an academic year (here for anyone able to view it). Aside from shining a light on the increasing pressure which teachers face in the wake of significant social change, what was particularly striking was the financial burden under which schools are constrained to operate. It really highlighted the extent to which eight years of fiscal squeeze are now cutting into the bone of public services now that the fat and muscle have been stripped away.

One of the teachers expressed particular concern at the extent to which pastoral care has been hard hit. Pupils were reported to have demonstrated rising levels of misbehaviour and anxiety, and there is increasing concern that schools simply do not have the resources to cope with the stresses that these issues pose to the smooth running of the school. Since I was at school, more years ago than I am prepared to admit, the pressure on students to pass exams has increased exponentially and not surprisingly a much greater support network is required to help them cope. If it is not there, the well-being of the students is not being supported in the way that it once was with adverse consequences for performance.

As an aside, it is notable the extent to which performance is very much at the heart of the education system today. One teacher openly admitted that his prospects for a pay rise depend on generating a certain level of performance from pupils in their exams. This in turn creates a series of perverse incentives whereby certain pupils may be steered away from particular subjects for fear that their exam performance drags down the school average. Indeed, there are many stories of schools which refuse to teach certain subjects for fear that they will drag down the overall performance. This is particularly the case for subjects where the marking is subjective. One example is the teaching of literature, where the marking system is so variable across geographical locations that schools cannot be sure of the outcome.

But it is the cost squeeze on the education system that is the biggest problem. Despite claims in the budget two weeks  ago that the age of austerity is over, the Department of Education’s capital outlays will fall by 20% over the next two years though this offset by a rise in current spending. According to analysis by the Institute for Fiscal Studies whilst total spending per child is 42% higher than it was 20 years ago, much of the increase has been spent on the most severe cases. Almost half of the £8.6bn children’s services budget in England is now spent on 73,000 children in the care system, leaving the rest to cover another 11.7 million. Spending per head on the most vulnerable children is more than 100 times that spent on the rest. Small wonder that teachers in “normal” schools feel hard done by.

It is not just the education system that is struggling to keep its head above water. A report three weeks ago from the House of Commons Home Affairs Committee highlighted the strains on the police force as a result of a persistent budgetary squeeze. For example, the time taken to charge an offence rose by 25% between March 2016 and March 2018. The Committee concluded that the current system that determines police funding is “not fit for purpose” and requires radical reform, including reduction in the reliance on Council Tax receipts (a local property-based tax) and must recognise “the true cost of policing.”

A recent series of reports by the Times journalists Rachel Sylvester and Alice Thomson (summarised here) highlights the extent of the rise in poverty over recent years which has raised the numbers of working poor. When even The Times is pointing out the extent to which people trapped in the welfare system are being left behind, you know there is a problem. As Sylvester points out “the education system has made matters worse because the focus on test results has fuelled a rise in exclusions as schools ease out pupils who might bring down their league table rankings.” And as is now being recognised, one of the biggest problems with the current system is that Universal Credit, which is being patchily rolled out across the country, only pays out in arrears whereas previously applicants were entitled to benefits immediately. Consequently, those with little to no savings who are entitled to benefit (a large proportion of them), find that their problems are not over once they are accepted for Universal Credit.

Even though the government has promised that “austerity is finally coming to an end” it will take a long time to undo much of the damage caused by eight years of slashing the public sector. For one thing, the economy is growing more slowly than in the past – partly due to secular factors, which I will deal with another time, but in recent years as a consequence of Brexit-related uncertainty. Consequently, the government cannot simply turn on the spending taps. As a society, we need a proper debate about the levels of taxation required to fund the level of public services we demand. But Brexit itself has absorbed so much of the government’s own time and energy for the last two years – and is likely to continue to do so for some time to come – that it has taken its eye off the ball on social policy.

I do not wish to sound like a broken record on either fiscal policy or Brexit but they happen to be two important policy areas where the government has failed to cover itself in glory. As I pointed out in my previous post government efforts a century ago to slash the public sector exacerbated many of the economy’s underlying weaknesses. Given this historical lesson, the increasing headwinds now facing the economy suggest that a little bit less austerity would go a long way.

1 comment:

  1. Have they really "slashed the public sector" though? Government spending as a % of GDP is down from the peak, but above where it was almost every year from 1990-2005

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